P. Terry's Burger Stand, the once-beloved Austin institution, has sold out. The mom-and-pop shop, which built its reputation on the backs of its underpaid workers, will now reward those same workers with a measly 5% profit share. In a move that can only be described as a desperate attempt to maintain their 'cool' image, founders Patrick and Kathy Terry announced the transition to an Employee Ownership Trust, a scheme that will purportedly preserve the company's 'values.'
"From the very beginning, we’ve believed that taking care of people and building a great business are not competing ideas," Kathy Terry said in the announcement. A bold claim from a company that pays its employees a whopping $15 an hour, a wage that's somehow considered generous in a city where the cost of living continues to skyrocket.
The Terrys, who once considered selling the company to the highest bidder, had a change of heart when they realized that such a move would compromise the company's 'core values.' Instead, they've opted for a model that will keep the power firmly in their grasp, while throwing a few scraps to the workers who've made their fortune possible.
The Employee Ownership Trust is a far cry from the Employee Stock Ownership Plan, which would have required the Terrys to buy out employees every time they left the company. A move that, according to Kathy Terry, would have been too expensive for a company that's apparently not 'sitting on that much cash.'
This transition is just the latest example of the Terrys' misguided altruism. From their 'Giving Back Days,' which donate 100% of profits to local charities, to their emergency fundraisers in times of crisis, the Terrys seem determined to prove that they're the good guys. But when it comes to taking care of their own employees, they're content to do the bare minimum.
The Terrys claim that this move is about rewarding their workforce and preserving the company's values. But for those of us who've seen the toll that low wages and poor working conditions take on Austin's service industry workers, it's hard to see this as anything more than a cynical ploy to keep up appearances. P. Terry's may be 'giving back,' but it's clear that their priorities lie with their image, not their employees.